Mortgages in Canada can be a murky subject – one that we hope to shed some light on with a series of highly informational articles.
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Credit counselling, Consumer proposal or Bankruptcy… Which option is most favourable?
– canadamortgagenews.ca
A couple in their 30s contacts me for a mortgage. They want to buy a new home. She’s a high school teacher and he’s a computer firm manager. Incomes are good. I check their credit.
Let’s stop here for a minute… If they have good credit, an approval is simple and we can provide the clients with several mortgage options.
But let’s assume that this couple ran into some debt and credit issues three years ago… and they made three different choices about how to resolve those credit problems: 1) Credit Counselling; 2) Consumer Proposal; or 3) Bankruptcy. I want to take you through each scenario and show you how long each of these three options affects your ability to finance a home. I bet the results will surprise you!
1) Credit Counselling. I pull a credit report and see that the clients approached a credit counselling company three years ago. There are R-7 ratings on the credit report. R-7 means you’re making regular payments through a special arrangement (usually indicating you’re paying less than what you actually owe)…
I’m getting divorced. Should I keep the family home?
– canadamortgagenews.ca
You’ve heard the stats: 1 out of every 2 marriages fails. Actually, I think the number of failed marriages is even higher now. Wait, let me rephrase that. A marital split is not a failure. I think that’s old-world thinking. A marital split is usually a positive move for all parties involved – for the spouses who are no longer in love and the kids who don’t have to see an unhappy married couple.
Marital splits can be a very emotional and difficult time in one’s life – especially when there are kids involved. There’s always one parent who wants to keep the house because the kids grew up there or have friends there or it’s just more familiar to them.
Having worked on 8,000+ mortgage applications at this stage in my career, I’ve witnessed my share of separations and divorces. I’m going to share what I’ve seen – a financial and personal perspective on marital splits.
What can you cut from your budget to make it work?
Trying to keep the house begins with good intentions…
Canadian Household Debt Hits Record High – $1.8-Trillion Owed
– ratesupermarket.ca
According to a new Equifax report, Canadian consumer debt has now climbed to over $1.8-trillion.
$1,821,000,000,000 – That’s how much collective household debt Canadians had in the fourth quarter of 2017 according to a recent study done by Equifax, which is up from the $1.797 trillion reported in the previous quarter.
The report attributes the rising debt to an increase in the various types of loans Canadians are taking out, including mortgages (6.2 per cent), auto loans (6.5 per cent), and installment loans (10.3 per cent). While it may sound like a lot, Regina Malina, a senior director of decision insights at Equifax Canada, believes things may not be so bad.
“Despite the high debt, mortgage payments are generally on time, which could be attributed to low unemployment numbers and mortgage and auto finance interest rates which are still at historically low and reasonable levels,” said Malina in a statement released Monday.
As it turns out, 46 per cent of Canadians reduced the amount they owed last year, 37 per cent that added more debt to their load, and 16 per cent of Canadians maintained the same level of debt…
